The course weblog for PA5113, State and Local Public Finance, at University of Minnesota

Wednesday, May 13, 2015

Parks and Recreation Services Expenditures in Saint Paul and Minneapolis

The Department of Parks and Recreation plays a huge role in helping the City of Saint Paul attain its goal of becoming the most livable city in the country. The City’s Parks and Recreation system is a nationally award winning organization that oversees more than “170 parks and open spaces, the Como Park Zoo and Conservatory, 24 city-operated recreation centers, four golf courses, and more than 100 miles of trails. Despite the many entities for which the Parks and Recreation Department is responsible, the total spending budget for the Department decreased between 2014 and 2015; it fell 3% from $58.6 million to $56.9 million, which amounts to $193.29 per resident.

Saint Paul, like many municipalities, is experiencing an increased demand for its parks and recreation center services. Population growth has had significant impacts on its parks and recreation system. To accommodate this growth, additional facilities will be necessary. But whether this accommodation is feasible is another story. Like in countless other municipalities, funding for expansion in Saint Paul is limited. Because the City’s discretionary budgets have been decreased, the Parks and Recreation Department is not sufficiently funded. A consolidation plan, that would close low quality recreation facilities, and thus, reduce maintenance and operating costs, is projected to save the City $20 million over the next twenty years. Though this approach may save money, it poses serious questions of access and equity.

The overall high demand for these services would make it more difficult to justify a decrease in their offering, but budget cuts are a reality that must be considered. There is an alternative option that can be pursued - increasing efficiency through the adoption of a cost of service model, as the City of Portland has done, is one way for Saint Paul to proceed. You can read more about this model here.

Like Saint Paul, Minneapolis has a nationally recognized park system; however, there is no Parks and Recreation Department. In Minneapolis there is the Park and Recreation Board, an independent board, a separate legal entity – but one for which the City is financially accountable.

Eight cents of every dollar residents pay toward property taxes will go to the Minneapolis Park and Recreation Board. The Board’s expense budget of $99.3 million, an increase of 2.7% above the 2014 budget figure, is significantly larger than Saint Paul’s budget of $56.9 million. Unlike Saint Paul, whose budget shrunk, the Minneapolis Park Board budget actually increased. The amount spent per resident in Minneapolis is also much higher than in Saint Paul: approximately $248.20 is spent per resident in Minneapolis. The City uses this great transparency platform to provide access to its budget data - I definitely recommend checking it out!

The Board has been able to reduce expenses by over $2 million by undertaking operational improvement initiatives. And with Resolution 369 in 2014, and the adoption of a 4.9% tax levy increase, the Board is now able to levy $50,560,000 from property taxes. The new tax levy may produce the required funding for the Board; however, that has yet to be determined, as this year will be the first time the additional money will be collected. What is clear is that Minneapolis doesn't face the same budget constraints that Saint Paul does.